Timothy Lee published an Op-Ed in today’s NY Times entitled Entangling the Web in which he argues that ensuring Network Neutrality would be tantamount to big government regulation, which would lead to monopolies and corruption. Mr. Lee seems to ignore the fact that we are already there.
I have always found it, more then a little, annoying that the policy wonks and legislators who expose opinions about how the Internet should be deregulated have little to no understanding of how it, or related services, actually work. Comparing Network Neutrality to 19th C. railroad regulation, Lee states:
Unfortunately, the story is a cautionary tale. After President Grover Cleveland appointed Thomas M. Cooley, a railroad ally, as its first chairman, the commission quickly fell under the control of the railroads, gradually transforming the American transportation industry into a cartel.
I think Lee needs to check with FCC chair Martin, to confirm we already have a cartel under the control of big telecom. In the past few years the number of local exchange carriers has dwindled from dozens to three — really two (SBC/ATT & Verizon), as Qwest’s ILEC footprint is very small. These two companies control over 70% of residential and commercial infrastructure. And thanks to FCC rulings made the at the end of last year, these companies no longer have to provide access to their copper facilities to third parties at set rates.
But Lee continues his transportation analogy:
By 1935, when it was given oversight of the trucking industry, the commission was restricting competition and enabling price increases throughout virtually the entire surface transportation industry. Decades later, in 1970, a report released by a Ralph Nader group described the commission as “a forum at which transportation interests divide up the national transportation market.”
What Lee fails, somehow to grasp, is that unbridled de-regulation has allowed so much consolidation in carriers that these corporations may, at any time, ‘restrict competition and enable price increases’.
Lee, and others, continue to confuse transport with content. He suggests that the Internet is like the national highway system, and like trucking deregulation, eliminating regulation will create more competition. This only works because the highway system is publicly owned. Would this same equation yield the same results if General Motors owned say 40% of all highways? and if, say, they were going to charge an additional fee to non-GM trucks using their highways? This is the appropriate analogy for network neutrality.
ATT, Verizon, and the cable carriers are fighting to eliminate the existing network neutrality status quo not because because of current Internet use, but due to what the use will be in the future. Very soon mpeg encoding will become efficient enough to allow for competitive Internet based television content providers. When this occurs it will create a media revolution we never seen the likes of.
This Internet ‘television’ will not be regulated by the FCC, or by the big cable companies; consumers will have enormous content choices and advertisers will have thousands of options of reaching viewers. ATT, Verizon, and the cable providers are unhappy about the prospect of providing transport for content which is not theirs. It is the desire to eliminate this competition before it exists that is driving anti-neutrality forces.
By confusing transport with content Lee, who does seem to be an independent commentator, turns his argument on it’s ear. By allowing carriers to opt-out of neutrality we will quickly arrive at the place which he seems to fear – fewer consumer choices, higher prices, and a corrupt monopolistic control over Internet content.
